Introduction

The Background of Nike, Inc.

Nike, Inc was founded on January 25, 1964 as Blue Ribbon Sports (BRS) by Bill  Bowerman and Phil Knight.  In 1972, BRS founded their "Nike" (pronounced NI-KEY), named after the Greek Goddess of Victory, line of footwear and BRS officially renamed itself to Nike, Inc in 1978. It had overtaken nearly 1/2 of the athletic footwear market, though not by traditional advertising means; for Nike did not run a TV advertisement until 1982.  After the following years, Nikes are sold in 40 foreign countries, over 200 unique Nike shoes are mass-produced, and sport-specific shoes and cleats appear all over the world.  Nike then began it reputation for creating unique and inspiring ads, beginning with its "Just Do It" slogan in 1988.

Why NIKE?

Do you jog? Do you do exercise frequently? Are you a sports master?
A pair of comfy sport shoes always playing an important part for the athlete. When mentioning about sports, most of the people would directly think about the brand of shoes, such as: Nike, Adidas, or New Balance. However, Nike is always the most outstanding among so many different brands of shoes and it has a large group of customer. Thus, we would like to study whether the price of Nike is sensitive with the demand change and would the price of Nike influence the demand.

Market Competition

Nike is in the monopolistic competition which there are existence of many firms that operate and sell similar but not identical products. There is freedom to entry or leave the market because there are no major barriers to entry or exist. Nike offers differentiated products to the market which are different designs, quality and making materials. From this, it shows Nike is a price maker firm as they could charge a higher or lower price than its competitors. Nike can set its own prices and does not have to be a price taker from the industry. For demand elasticity, Nike could be more elastic than monopoly as there are many firms existed in the industry and having a lot of close substitutes products. Example like, Adidas, Puma, New Balance and others.

Problem statement

• What are the factors of people consider when buying sport shoes?
• How are consumers being affected by the changes in the price of Nike shoes, changes in the price of substitutes goods, alternative means of transport, etc.?
• Why do people choosing Nike brand when buying sport shoes? 

Objectives

• To understand the main demand factors of Nike among the consumers, and how it affects their choices.
• To analyse the elasticity of demand or the sensitivity towards changes in price, for Nike in the local consumer market.

Limitations

The limitation in conducting survey :

• Respondent are not clearly answer the survey given question.
• Group members are lack of experience in designing survey questions.